In Latin America and the Caribbean, biodiversity and ecosystems are among the region’s most valuable assets and of strategic importance for attaining long-term sustainable development. But traditional conservation approaches that focus only on biodiversity may miss opportunities to provide benefits in the form of ecosystem services to the people living in the region.
Latin America and the Caribbean cover vast areas on both sides of the equator, including a wide range of tropical, subtropical, and temperate ecosystems, and even the icy waters off Antarctica. The region contains close to 800 million hectares of forested areas, 570 million hectares of wild savannas, 700 million hectares of productive lands, and 27 percent of the planet’s available drinking water.
The region is known for its exceptional biodiversity. South America alone accounts for half of the global terrestrial biodiversity. Some of the world’s most biologically diverse countries are situated in the region, including Brazil, Colombia, Ecuador, Mexico, Peru, and Venezuela. More than half the Caribbean flora cannot be found anywhere else on the globe.
At the same time, the region is rapidly changing in ways that put pressure on biodiversity. Between 1950 and 2010, the population in Latin America and the Caribbean grew by more than 250 percent, and the last 20 years have seen a near doubling of the GDP. As the countries in this region become wealthier, the urban and middle class populations grow. So, too, does the demand for energy, water, food, forest products, land, and minerals. Now at a crossroads, the region faces an enormous opportunity and challenge to ensure that ecosystems are managed sustainably to provide the services needed to meet this demand.
Traditionally, conservation efforts tend to focus on areas unique in biodiversity, such as those with the greatest number of species. But a more comprehensive approach is becoming popular that considers broader ecosystem benefits in addition to biodiversity. Conservation funding can be seen as an investment with measurable returns—often in biophysical quantities, such as the number of species, but sometimes also in dollars. At its core is the concept of ecosystem services (see the box below).
Despite the fact that many ecosystem services are not readily transacted and valued by the market, they are still economically valuable. Over the last several decades, economists have developed different approaches to determine the value of non-market benefits so that they can be considered alongside market values in the management and protection of ecosystems. Estimates of the value of ecosystem services in various parts of Latin America and the Caribbean are sparse, but what information we do have offers cues about the drivers of the value of ecosystem services.
We compiled these estimates from the economics literature and were able to develop models to predict localized ecosystem values as a product of the ecological and socioeconomic factors of each area. We found considerable geographic variation in the value of ecosystem services. And when these values are combined with the rate of habitat destruction—which drives the loss of ecosystem services—a clearer picture emerges of areas where potential conservation investments would have the highest returns in protecting the value of ecosystem services.
These areas are not necessarily where biodiversity is richest or ecosystem values are highest. Instead, they may be located in places where ecosystem services values are mid-range but threaten to plummet because of high rates of habitat loss. These include parts of the Amazon, southeastern Atlantic Coast, Gulf of Mexico, and parts of the Caribbean and Mesoamerica.
The Economic Benefits of Healthy Ecosystems
Ecosystems in Latin America and the Caribbean support a wide range of human activities—such as agriculture, fishing, forestry, and tourism—that produce market goods and services. These activities play important roles in supporting income and employment in the region; in particular, the four sectors just mentioned employ 17 percent of the region’s workforce and account for 15 percent of its GDP.
The same ecosystems also contribute many services that are not bought and sold in markets. For instance, ecosystems provide habitats for various species, help control floods and water runoff, and purify and store water for drinking and other uses. They maintain soil productivity and support the pollination of crops and other vegetation. And they maintain and improve air quality, provide climate control, contribute to the carbon cycle, and support a wide range of amenities to people. Consider the following examples of the importance of ecosystems to economic activities:
- In Latin America and the Caribbean, 73 percent of freshwater use, critically supported by the availability of wetlands, is for irrigated agriculture, which contributes 10 percent to the region's GDP.
- Supported by rich natural resources that range from the Amazonian jungles to the sandy beaches of the Caribbean, regional tourism revenue in 2011 was US$364.3 billion.
- Fish consumption is extremely important throughout the region and is often supported by artisanal fishing; in Brazil, it represents over half of production.
Estimating Ecosystem Values
To determine the magnitude of ecosystem values in the region, we turned to the studies that have collected evidence of economic benefits from ecosystems in Latin America and the Caribbean. We looked for estimates that are tied directly to an ecological endpoint and expressed in a clear and consistent ecological unit, like dollars per hectare. The resulting 88 value estimates covered a wide range of ecosystem services and analytical approaches, and the estimates themselves vary significantly. The estimates vary by ecosystem service addressed but are less distinguished by ecosystem type (see Figure 1). To understand the drivers of the value of ecosystem services, we developed models that predict the value of local ecosystems (in dollars per hectare) as a product of these ecological and socioeconomic factors:
- ecosystem characteristics (coral reef, wetland, tropical forest, other forest, other);
- ecosystem service (protective services, recreation, biodiversity, genetic resources, food, nursery);
- provisioning services (raw materials, soil maintenance, water); and
- study area characteristics (GDP per capita, population density, protected area status).
Our analysis reveals systematic associations between the value of ecosystem services and the ecological and socioeconomic characteristics of the ecosystem. For example, we found that the value of ecosystem services increases with the income level and population density of the study area. We also find that the estimated value of coastal protective services (for example, storm and flood protection) tends to be highest on a per hectare basis, on average.
Mapping the Value of Ecosystem Services
Using these associations, we projected the local value of ecosystem services throughout Latin America and the Caribbean. We developed these values by “ecoregions,” which denote biogeographic delineations of the region based on distinct collections of natural communities and species.
Our predictions (Figure 2a) show considerable geographic variation in the estimated value of ecosystem services, which ranges from near zero to several thousand per hectare. We find the highest values for much of southern South America, parts of the Caribbean, and parts of Mexico. On the other hand, parts of Mesoamerica, much of the rest of the Caribbean, and interior South America have relatively low values.
Where Are the Greatest Potential Gains from Conservation?
When thinking about where the most potential exists to generate benefits from increased conservation efforts, the story doesn’t end here. Another important element to consider is which ecosystems are under the biggest threat. In other words, where are ecosystem values expected to decline the most, given ecosystem degradation? When overlaid with a map of predicted habitat loss, the picture changes dramatically.
Habitat loss is one of the key concerns in the protection of ecosystem services. The value of these services often depends on the quality and extent of ecosystems, which are reduced by the conversion of land for uses such as agriculture, forestry, or urban development.
A comparison of the value of ecosystem services (Figure 2a) and their past losses triggered by habitat loss during the first decade of the century (Figure 2b) shows a discrepancy between the two. What emerges is that losses in value are largest in ecoregions concentrated in parts of the Amazon, southeastern Atlantic coast of South America, and parts of the Caribbean and Mesoamerica. Ecosystem service values there are midrange, but the rate of habitat loss is high. In these places, we see losses in value on the scale of roughly a few hundred dollars per hectare per decade. On the other hand, in parts of southwestern South America, where the estimated baseline value of ecosystem services is exceedingly high (Figure 2a), losses have been relative small.
These findings highlight the potential for developing conservation interventions and policy in light of the geographic variation in the value of ecosystem services at stake. Consider a hypothetical conservation program to prevent the loss of ecosystem services in Latin America and the Caribbean. As the maps indicate, the greatest returns under such a program may not come from regions where the current value of ecosystem services is the highest. Instead, the greatest losses of ecosystem services may be prevented where the current value of ecosystem services is somewhat lower but where the loss of habitat is relatively high.
The maps also indicate that the value of ecosystem services in Latin America and the Caribbean are much broader than the value of biodiversity alone. Whereas biodiversity in the region is particularly high in areas such as the western Amazon, Colombia, Ecuador, and northern and central Andes (the eastern slope of the Andes is considered the world’s most biodiverse area), the areas of especially high value of ecosystem services are more broadly distributed and include even areas of relatively low biodiversity, such as several of the southernmost ecoregions. This discrepancy underscores that a focus on species does not necessarily account for the full range of services ecosystems have to offer. But conservation agencies may be interested in both biodiversity and ecosystem services, so the task of priority setting may ultimately be to find target regions that best support both objectives.